Santa Cruz to weigh ballot measures on election financing, pot tax

SANTA CRUZ &GT;&GT; Undaunted by previous rejections to establish some public financing of City Council elections, Councilmember Micah Posner will ask colleagues Tuesday to place the matter on November's ballot.

The voluntary cap, in place since 2000, initially was abolished on a narrow vote of the council in June on behalf of first-time candidates for whom spending limits could be a barrier to winning. Council members lamented there also was no strong mechanism for controlling independent expenditures on the part of unions and other political groups.

The council reversed its decision in July, reinstating the voluntary limit at $38,064 but not approving public financing for those who accept the cap, the main benefit of which is the waiver of a nearly $1,500 filing fee. The council did agree, however, to mandate a previous voluntary limit of $350 for individual campaign contributions by people, businesses or organizations.

When he began a push for campaign finance changes last month, Posner said there was no evidence that increased campaign spending in recent years was a reflection of corruption, though he believed preventive measures were needed. He said San Francisco, Sacramento, Ventura and other cities offered some public funding for municipal elections.

"It's fundamental to a functioning democracy, having some kind of campaign spending reform," Posner said Monday. "The current system in the nationwide sense is disrupting our democracy."

The City Manager's Office estimates the cost of public matches, when council races are held every other year, would not exceed $160,000 based on the expectation that no more than eight candidates would raise half of the voluntary cap, or between $19,000 and $20,000. The city would then match those funds.

Also Tuesday, the council will decide whether to ask voters to approve a business tax on medical marijuana dispensaries, of which there are two within city limits. The Santa Cruz County Board of Supervisors in June approved a similar ballot measure.

Modeled after San Jose's cannabis tax, Santa Cruz would collect a 7 percent tax on gross receipts of CannaCruz and Greenway, both of which are located in the Harvey West industrial park. The tax could generate $100,000 to $150,000 in revenue for the city's general fund each year, and the tax would not be allowed to grow higher than 10 percent.

The tax money would be used for public safety, parks, street maintenance and youth and serious programs, according to the city.

Brad Palmer, a founder of CannaCruz, which opened April 1, opposes the tax because it impacts lower-income people who are seeking doctor-approved medicine.

"It kind of just blows my mind that they are going to levy this additional tax of 10 percent when it's a hardship for people to get their medicine," he said. "Many of these people use this to replace other prescription drugs. I don't see why we should be treating this any differently."

Lisa Molyneux, a founder of the 9-year-old Greenway, has urged the council to hold off until voters statewide weigh in on whether pot should be allowed for recreational use, then tax those sales rather than medical uses.

"We are already heavily taxed by the state like no other business and the patient shares this burden," she said.

SANTA CRUZ CITY COUNCIL

What: Discussion of November ballot tax measures establishing public financing for City Council campaigns; a medical marijuana tax